German Court Rules Argentina Can Pay

German Court Rules Argentina Can Pay

June 15, 2006

A court in Frankfurt, Germany, has ruled that Argentina must pay back the capital and accrued interest on its defaulted bonds to two private German investors because the country is no longer insolvent or in a state of emergency. The ruling may have set a precedent for other lawsuits pending against Argentina, although it is not clear whether state assets can be seized. The government defaulted on its bonds in 2001 and put forward a debt swap offer in 2004. However, around 24% of the sovereign's bondholders refused to take up the offer.

A court in Frankfurt, Germany, has ruled that Argentina must pay back the capital and accrued interest on its defaulted bonds to two private German investors because the country is no longer insolvent or in a state of emergency. The ruling may have s